Catalyst to Accelerate Decarbonisation in Asia Pacific through Carbon Markets
Your Excellency Simo Kilepa, Minister for Environment, Conservation and Climate Change of Papua New Guinea
Mr Tom McMahon, Co-founder, ACX
Mr Louis Redshaw, CEO and Founder, Redshaw Advisors and Net Zero Markets
Mr Ben Garside, Director and Co-founder, Carbon Pulse
Ladies and gentlemen
Distinguished guests,
Opening remarks
1. Thanks for inviting me to the inaugural Carbon Forward Asia. We warmly welcome those of you, who are visiting Singapore and for you to hold many future editions in Singapore. In fact, we just came out of COVID and if you look around you at the Marina Bay Sands, it was a very different environment. But we tried to bring it back to life and I think over the last eight to nine months, many different events have been held in agrifood, industrial, hotels and now to a very topical topic, carbon services and trading.
2. In Singapore we do not just have the ambition to be a carbon services and trading hub. But also to be a business events hub, exhibitions hub, agrifood hub, financial hub and tech hub. You get the picture – a hub of hubs.
3. I want to talk about catalysts. A catalyst precipitates an event, or a series of actions.
4. Today, I shall talk about a catalyst that drives climate change and a catalyst that drives climate action. We want less of the former and more of the latter. There are many catalysts that are precipitating climate change. For example:
a. Human action
b. Hole in the ozone layer
c. Burning of fossil fuels
d. Rise in waste
5. These catalysts do not just drive or precipitate climate change, they have real life impact. In fact our Asia Pacific region, has faced the direct impact of climate change and its far reaching consequences on the environment, economy, livelihoods, and the lives of people in the region.
6. In 2009, when I worked at the United Nations, I met an official from Vanuatu, a nation made up of a chain of islands between Australia and Fiji. The official told me, “my country is sinking”. Last year, Vanuatu’s Climate Change Minister Ralph Regenvanu warned that his government would have to relocate “dozens” of villages in “at-risk areas” within the next 2 years.
7. We have all heard that climate change is the defining challenge of our generation. COVID has passed or generally passed but climate change is enduring. It affects all of us, not just Papua New Guinea or Vanuatu. We are all already experiencing its impacts, such as prolonged heavy downpours, scorching temperatures in the last few months and in many parts of the world extreme weather events.
a. The catalysts driving climate change affect our Asia Pacific region disproportionately.
b. We must hence take urgent and ambitious actions. There is nowhere better to start than here, where we are, the Asia Pacific.
8. Why? Let me share a few facts about the region, which many of you would already know. The Asia Pacific Region:
a. Represents 22% of the world’s land mass;
b. Is home to the most number of people on earth, it comprises about 60% of the world’s population, which is about 4.3 billion people. Some of these people live in areas most impacted by climate change;
c. It accounts for about half of the world’s carbon emissions; and
d. Hosts some of the most fast-growing carbon markets.
9. What all of this means is that we have an opportunity to make a difference in this region, we can accelerate decarbonisation in the Asia Pacific through carbon markets. Which is why we are here today.
10. I have shared about the catalysts that drive climate change, I shall now share about the catalysts that drive climate action and we see Singapore playing this role as a catalyst for climate action here in the Asia Pacific region. Let me elaborate:
Catalysing Climate Action in Asia Pacific
11. First, I believe Singapore can catalyse climate action in our region.
12. We are a low-lying city state and we are an island nation. We are thus vulnerable to the impacts of climate change.
a. Last year, we announced our goal to achieve net zero emissions by 2050. We aim to reduce emissions to around 60 million tonnes by 2030, after peaking our emissions earlier.
b. How do we achieve this, we are raising our carbon tax.
i. Currently priced at S$5 per tonne of greenhouse gas emissions, We will increase to S$25 in 2024, and eventually S$50 to S$80 by 2030. So it is gradual.
ii. The carbon tax covers about 80% of Singapore’s emissions and sends a clear price signal to induce greater decarbonisation.
iii. Did you know that we are thus far the only country in Southeast Asia to have a carbon tax.
Catalyst to Build Credible Carbon Markets
13. Second, Singapore can catalyse the building of credible carbon markets.
14. As we transition to net zero, we need high environmental integrity carbon credits as crucial enablers to offset residual emissions from hard-to-abate sectors.
a. Carbon markets are critical to channel financing towards carbon abatement and removal projects globally, at the same time they can contribute to sustainable development benefits and spur growth in the green economy. As discussed this morning, it is difficult for carbon markets to work.
15. For carbon markets to work, we must address concerns around standards, quality and transparency.
a. Singapore has played an active role in co-facilitating discussions on Article 6 of the Paris Agreement at COP26 and COP27.
b. These discussions aim to provide clarity on environmental integrity, and to lay a strong foundation for international carbon markets.
c. We also actively participate in the Integrity Council for the Voluntary Carbon Market (ICVCM) and the Voluntary Carbon Markets Integrity Initiative (VCMI), both these initiatives set global benchmarks for carbon credits and the use of such instruments.
16. Domestically, we are finalising the environmental integrity criteria for the use of International Carbon Credits (ICCs).
a. These are credits that our carbon tax-liable companies can use to offset up to 5% of their taxable emissions from 2024. We will publish a whitelist of eligible carbon offset programmes and methodologies later this year.
17. In addition to that we are also enhancing trust and transparency in carbon credit trading.
a. Last year, with the International Emissions Trading Association (IETA) and World Bank, we announced that the Climate Action Data Trust (CAD Trust) would be anchored here in Singapore.
b. The CAD Trust enables a decentralised record of data from major carbon credit registries, with the intent to build confidence in carbon markets. Many of you may know our Singapore Green Plan. Through this plan, we are developing an ecosystem of carbon services and we have also been anchoring key players in our carbon market ecosystem. For example, there are more than 80 players in our carbon services sector here already in Singapore. This is the highest concentration in the whole of Southeast Asia. These firms are important because they provide a range of services such as clean energy, project development, consultancy, audit, certification services and they will support companies as you map, measure and reduce your emissions. But we also discussed about the challenge across industries, about Talent. Do you have enough talent? Where do you find talent to build and drive carbon markets? We are trying our best and trying to make it easier to hire roles in this particular sector with a points-based employment pass framework that we will launch on 1st September this year. Particularly, in roles such as audit specialist, carbon trader, carbon project manager and methodology analysts. These are just examples of how Singapore is catalysing the building of credible carbon markets.
Catalyst to advance International Cooperation
18. Third and finally, Singapore can catalyse international cooperation to achieve climate goals the climate goats that we set.
19. The close collaboration between partner countries as well as the active participation of the private sector underpins the success of Article 6 of the Paris Agreement.
Government
20. Singapore is actively fostering Article 6 partnerships with other countries.
a. We have already inked Memoranda of Understanding (MOU) and similar agreements on carbon market cooperation with countries, including Papua New Guinea, Peru, Colombia, Indonesia, Vietnam. In fact, we just signed a MOU with Cambodia to collaborate on carbon credits last week.
b. We have also substantively concluded discussions with Ghana on an agreement, which sets out a framework for the transfer of correspondingly adjusted carbon credits between Singapore and Ghana.
Commercial & NGOs
21. Singapore is also building a strong ecosystem of local and international players to fully harvest the opportunities of carbon markets.
a. As a trusted go-to marketplace for the region for both the compliance and voluntary carbon markets, we are already home to more than 100 businesses and organisations here, such as project developers, service providers undertaking measuring, reporting and verification, and carbon traders.
b. To that end, I am happy to share that the International Emissions Trading Association (IETA) will be establishing its office in Singapore this year to advance carbon market solutions in the region. IETA will also work with the regional stakeholders on capacity building, and supporting the development of frameworks and systems to enable parties to participate in this growing carbon market.
22. So we encourage many of you and the companies you represent here to set up, expand your offerings in Singapore, use our networks as a trusted financial, services and commodities trading hub to grow your businesses, to learn more and to collaborate
Conclusion
23. In conclusion, we can meet the climate change by minimising the catalysts that drive climate change and enhance the catalysts that drive climate action.
a. The more we minimise the former and strengthen the latter, the less insurmountable our task is.
24. So on behalf of the organisers, the government of Singapore, we would like to thank all of you, our catalysts for climate action, for being here today, building networks, building markets, building ideas that can translate to action, together we can support a thriving carbon services and trading ecosystem, achieve our climate goals and capture opportunities in a low-carbon future.
25. I wish you all a successful and fruitful event.
26. Thank you.